The Certified Commercial Investment Member–CCIM–designation is a mark of excellence within the commercial real estate industry.
“The designation provides you with immediate credibility and access to a national and international network of strong brokers,” said Southern Nevada CCIM president elect and a first vice president with CBRE, Roy Fritz. “It took me four years to get through the education and then you have to submit a portfolio of multimillion dollar deals you’ve done that says, ‘Here, I’ve survived the education; I have the experience.’”
“The designation brings credibility and a common ground for all those who have earned it through education, knowledge acquired and networking,” said Bobbi Miracle, Southern Nevada CCIM education chair and a broker with Commercial Executives Real Estate Services. For buyers and sellers, clients and other commercial real estate professionals, working with a CCIM means working with a professional who has a proven level of success that can be counted on to make a transaction run smoothly.
The CCIM designation is more than just four letters after one’s name. It’s proof of having completed at least 160 hours of education, and having passed the national test that takes five or six hours to complete, said Paul Chaffee, Southern Nevada CCIM president. Chaffee is also vice president with CBRE and an associate director at the UNLV Lied Center for Real Estate.
In transactions, that education matters. CCIMs have learned how to evaluate deals and help participants understand how properties might be priced and how to work through balance sheets and expenses and bring properties to market for the best return for sellers.
“That’s a huge advantage versus someone who has no idea because they’re not required to take any additional evaluations classes to become a real estate agent in Nevada. So how is CCIM an advantage? For the designees, the real estate community, and people looking to buy real estate, we have additional tools in our tool belts to help guide them through the transaction,” said Chaffee.
The Educated Professional
“Education is the core of the CCIM program, with numerous courses ranging from three hours to four days,” said Miracle. The courses cover a variety of topics related to commercial real estate, and anyone can take them. Some classes are required—101 and 102 before 103 and 104—but the Negotiations class can be taken at any time, as can Foundations for Success in Commercial Real Estate. For those people primarily working in residential real estate but interested in commercial, the Foundations class can get them up to speed quickly. Classes are offered through the CCIM Institute, taught by industry practitioners, and offer real-world education.
“Taking an in-person course gives you the ability to learn directly from a highly trained instructor in that industry that has practical experience with real-world knowledge of the topic,” said Miracle. “Not to mention all of the students in the course you get to learn from too.”
The Southern Nevada CCIM chapter offers a significant amount of financial support for those seeking the designation. “We have four nationally endowed scholarships,” said Adam Gregory, Southern Nevada CCIM designation chair and senior vice president at CommCap Advisors. He added there are usually an additional three or four offered annually. “Classes are extremely expensive. When I went through them they were close to $1,000. Now they’re closer to $2,000. So offering any support you can for these young professionals, especially when we’re in the market that we’re in, is helpful.”
Classes are expensive for the chapter, too. Not every CCIM chapter can offer in-person classes, but the Southern Nevada CCIM chapter is ideally located for people from California, Utah and Arizona.
Challenges Ahead
The commercial real estate market started 2023 shaky and is still in flux. “Ask 10 people in the market what the challenges are and you’ll get 10 opinions,” said Chaffee. “But lack of product is definitely one that comes in at the top of the list. How can we help investors with the product that’s out there? We can actually help them understand the valuation of their return on that product if they do look at something.”
Tim Castello, Southern Nevada CCIM legislative affairs chair and principal with Brass Cap Companies, named three challenges facing the industry. The first is water. “There’s a potential moratorium on evaporative coolers that will affect the industrial sector of real estate going forward,” he said. “It’s going to be interesting to track how that affects tenant demand and use locally.”
Land constraints in a state where 90 percent of land is owned by the Federal Bureau of Land Management is another challenge, and the third concern is education. “When you’re recruiting Fortune 500 companies into this market, one of the things they look at is education,” said Castello. “If they’re going to move themselves or their executives out here, they want to know there’s a good education system.”
Then there’s the rapid rise in interest rates. “What that has done is broken the fundamental equation of commercial real estate,” said Fritz. In a typical market, lenders use the Fed’s funds rate to determine their rates for an asset before adding cap rates.
“Between the vast amount of capital that’s been injected into the system over the last few years and now the rapid rise in interest rates, over 500 bps over the last year, has compressed that equation and resulted in a substantial drop in transaction volume,” said Fritz. The upshot? In Q1 2023 transaction volume was down 85 percent compared to the biggest quarter of 2022.
Underlying fundamentals are strong—tenants are paying, vacancy rates are down—but the capital side is where the industry has issues that need to be worked out.
Where CCIMs can help investors in a shaky market is in understanding valuation metrics and cap rates. They can help investors broaden their view and instead of looking at a snapshot of how the property is performing right now, look at how it will perform over the next decade.
The mortgage banking side of commercial real estate has anticipated a slowdown in the market for years. This one exceeded expectations. “When the pandemic hit, we all thought, ‘This will kick it off,’” said Gregory. Actually it did the reverse when interest rates fell to near zero, cap rates significantly dropped, and the market flooded with product.
With spiked interest rates, owners aren’t putting properties on the market. Maybe they bought at 4 percent, not anticipating selling at 6.5 or higher. “There’s a lack of product on the market from a mortgage banking standpoint,” Gregory added. “If the borrower didn’t refinance the property by first quarter 2022, then they just weren’t interested in doing it, or they have long term debt and can wait this out. From our perspective there are very few refinance opportunities, and acquisitions are few and far in between.” The regional banking crisis isn’t helping—banks have essentially pulled out of commercial real estate right now; they’re not lending unless borrowers bring a significant depository relationship.
Then there’s a whole asset class that’s almost untouchable: office. “We’re still getting it done, but if you call and say I have an office deal I want to discuss, half the time they’re going to hang up on you,” said Gregory who doesn’t see an end in sight. “We’re going to have a lot of office assets that we’re going to have to work through the market and that’s going to, from a lender standpoint, significantly impact banks. Either they’re going to take these assets back or sell.” What’s selling is selling at a discount ever since regional bank failures started. “That’s a sign that we’re in a bad market,” he continued.
How can CCIM help? “They are a national pool of professionals that you can rely upon,” said Gregory. Borrowers come from all over the country; having another CCIM in that region, especially in a bad market, can make a difference. Because when one CCIM calls another, the other responds.
Networking
Networking is critical in commercial real estate. CCIM offers a variety of ways to connect. For people new to the industry or new to town, meeting other professionals can make all the difference.
“We’re always there trying to support each other,” said Jakke Farley, Southern Nevada CCIM, treasurer/secretary and an agent with Mountain West Commercial. “We’re all only getting older every day and without fresh blood, the industry won’t survive or there won’t be professionals in the industry in 20 years. So with the new guys, even if they don’t work in your firm, for me personally it’s, ‘Hey, I see you making big moves and making deals.’ We offer scholarships and just getting involved gets you face time with people who have been doing this for years.”
Southern Nevada chapter networking events include monthly luncheons, community outreach, an annual wine soiree and an annual putt putt tournament.
Community events and charitable opportunities allow members to give back while doing the work they love. “We have several charities that we donate to at the end of every year. We get excited about giving the money away and the community hours are great, especially for new designees still working on their careers who may not have a lot of money–it gives them a different way to volunteer,” said Farley.
Social events are a chance to network in jeans and a polo shirt rather than a suit and tie. “You’re a little bit more yourself and people really do conduct business with people they like,” said Farley. “That’s when you find the people you like, at social events. That’s when you’re going to make real connections versus a networking lunch or coffee where people are more likely to have their poker face on.”
Local becomes international when working with the CCIM network. “We are an international designation,” said Miracle. “It doesn’t matter if you are in Japan, Canada, Mexico or the United States, we are all learning the same information.”
Designees have access to the CCIM Site to Do Business where they can post properties or listings internationally. There’s also an Annual Governance Meeting that features a Drinks and Deals segment where anyone can present a property from the stage.
Legislative Affairs
One advantage to any professional organization is up-to-date knowledge of that industry. For Southern Nevada CCIM, the legislative affairs chair exists to inform members of anything happening in municipalities or the state legislature with the potential to impact the real estate community.
Day to day, members don’t necessarily have time to stay informed of changes to the community that can affect their business. “So we try to streamline some of that information and make sure the membership understands what’s going on, what issues are important to them, and what issues would be important for everybody to get involved with,” said Castello. Getting involved might mean joining a committee, reaching out to legislators or city or county officials. At the end of a legislative session, a chapter luncheon covers issues that either passed or didn’t in session which could impact the industry.
University Outreach
Current Southern Nevada CCIM chapter president Paul Chaffee is also the associate director of the Lied Center for Real Estate at UNLV. “I bring students from UNLV to networking events and help them understand how to network, how to work a room, how to meet people.” He does the same for new real estate agents working in commercial.
“The longer you do this, the more you’re going to build relationships, and the more you’re engaged. I was told a long time ago that people will really see how hard you work when they see how hard you work on something you don’t get paid for and go wow, imagine how hard that person will work when they do get paid,” said Chaffee.
Being involved on the board and on committees is networking. People who work together for the chapter think of each other first when a deal comes up.
In-person classes for CCIM education can also lead to forming relationships. Statistically, people who take in-person classes have higher passing rates than those who only take classes online. In-person is one more opportunity to meet other people in the industry.
The mentorship part of helping the next generation come through is important. We went through a time after the Great Recession when it was nearly impossible for new people to join the industry because the market was coming out of some very difficult times,” said Fritz. “There was a long stretch where there were very few people getting into the industry. It’s a tough industry. There’s a ramp up time period that takes a lot of time. You have to be with a good team. You have to be with a good organization. Then you can use the CCIM organization to help with that process as well.”
“We are only as good as we allow ourselves to be,” said Miracle. “Our community service events and the charitable donations change the lives of those we contribute to. From cleaning books with Spread the Word Nevada, cleaning up the wetlands or helping provide greatly needed clothing, school supplies and money to John S. Park Elementary, we make a difference for those that live in our community that we all love.”
